OTTAWA — Enjoying consistently high economic growth from 1993 to 2007, Canada has emerged from playing second fiddle to the United States to an economic superpower in its own right. Vast developments in the energy sector and impressive growth in manufacturing, mining and service have transformed Canada from a rural-based to an industrial and urban economy.
Tapping into its mass of natural resources while maintaining its commitment to the environment, Canada has powered itself with its vast oil and natural gas sector to become the world’s sixth-largest oil producer. Once dependent on the U.S. for oil, Canada has become the largest foreign energy supplier to American homes.
Subsequently, the economic strides made by Canada have translated into a higher standard of living for citizens. The boom in several key industries led to quality improvements in the country’s healthcare, social welfare, and education systems. With the higher quality of services getting delivered to citizens and continued economic success, the cost of living in Canada started to rise to where it is today.
At present, average after-tax annual incomes in Canada and the United States are roughly the same amount, at $36,000 and $35,300 respectively. Housing and food costs are where the discrepancy between the cost of living in Canada and the United States lies. When these two get taken into account, it is more expensive to live in Canada.
For example, monthly rent for a one-bedroom condominium unit located in the downtown area in an average Canadian city is around $907, more than in a regular American city at $878. A kilogram of chicken breast costs around $6.50 in the United States, while it costs around $11 in Canada.
These small differences in price seem trivial on the surface, but they do add up: using the rates indicated above, the disparity between rent in Canada and the U.S. adds up to nearly $350 over the course of a year. Over a five-year-period, it reaches just below the $2000 mark. Similarly, for a family who eats chicken breast thrice a week, there is roughly a $54 difference in monthly costs for food. That is an added $648 on a Canadian family’s food costs annually on top of the expense of other food products.
But not all things are more expensive in Canada. The cost of going to college, for example, is significantly lower in Canada than in the United States. An average bachelor’s degree in Canada ranges from $8,000 to $26,000 over four years, a small number compared to the cost of the same degree in the United States (at $37,600). The price for a year of study at a prestigious U.S. university such as Harvard (at roughly $50,000) is already twice as much as a standard four-year postsecondary program in Canada.
The difference in cost of healthcare per capita is also glaring. The United States has the most expensive healthcare per capita in the world, at $8,233, while Canada, known for its efficient and inclusive healthcare system, has a healthcare per capita $3700 cheaper than in the United States, at $4,445 per capita.
Those who have observed the socioeconomic trends of both countries agree that Canada and the United States have their share of strengths and flaws. While the cost of living in Canada is slightly higher due to added costs in some aspects such as housing and food, Canadian institutions are more suited regarding providing sufficient social services to their citizens. Healthcare, paid maternity leave and greater support for public schools are just examples of areas that analysts cite when explaining why there is an eventual payoff for Canadians’ higher cost of living.
– Bella Suansing